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RBatten
07-03-2012, 09:16 AM
I have looked far and wide for an average labor cost %. I know here in FL we earn our money in the summer and make our money in the winter so I was wondering what kind of labor % I should be shooting for in the summer and winter months.

I want my labor costs as low as possible but I can't see running 30% labor in the summer months. You end up working the guys like dogs and most will tire and quite. Then it cost more money to hire and train new ones.

We had a great spring with lots of projects and design install work, but now that summer is here, the projects have dried up and my labor costs are rising fast.

If you are willing to share you numbers with the group I'm sure that we can all improve our businesses. I don't go out and mow yards myself. I do have to help sometimes when things get really backed up, but as a general rule I don't spend time on the truck. So all the solo guys or owner operators out there, calculate an hourly rate or salary for yourself that meets industry norms and let us know what kind of % rate you get.

Right now I'm basing my rate on Maintenance work ONLY, and I'm coming up with between 35-45% depending on the week. Lots of rain, labor goes up. Hot and dry, labor goes down. I want my business to be profitable on Maintenance work alone so that all the extra stuff, mulch, sod, and misc plantings is all gravy and increases my profits. I don't want to depend on the project work to make a profit.

There you have it. Lets see your numbers!

Thanks for all your help.:usflag: Have a great 4th!!

jvanvliet
07-03-2012, 05:52 PM
I know what my daily & hourly nut is during season; I use the same numbers off season.

Landscape Poet
07-03-2012, 09:44 PM
I can not help you with the crews but will share my info in hopes of at least giving you some possible help.

I am solo with a assistant. My payroll runs me about 14% on the maintenance portion of things. This does NOT include my salary of course but rather just my payroll being paid to my employee.

So in theory, if I added another employee to take my place I would be running in the 28% to 30% range assuming that production would stay at the same pace.

It should be noted too that I generally pay my employee for a full 40 even during the winter months for scheduled weeks even if we do work a full week as I figure he has expenses he needs to cover too and keeping him satisfied is in my best interest.

I think you have the right idea in making sure your maint side controls your income you rely on, sod, installs etc are then just gravy as you said. This is the way I have always done it and it works for me.

Hope that helps,

Mike

Patriot Services
07-03-2012, 09:51 PM
Bear in mind most medium/large operations layoff the majority of their staff come winter. Seasoned guys understand this and don't mind working like dogs in the season knowing they will get a 2~3 month layoff in winter.
Posted via Mobile Device

jvanvliet
07-04-2012, 08:16 AM
Labor is my single biggest expense, followed by fuel, fleet maintenance and repairs. I don't know how you can possibly cut labor to as low as 14%. My labor cost lock stock and barrel (taxes, insurance, etc) is about 47% during season and about 30% off season (off season we furlough 30% of our crew).

RBatten
07-04-2012, 10:11 AM
jvanvliet, I don't know how large or seasoned your operation is but I have a question about your WC and Unemployment tax. Right now I'm paying the initial rate for unemployment tax which works out to 2.7% and then you add it the WC at roughly 3.5% and then Med & SS at 8.5% you call that roughly 15% on top of actual payroll. So assuming your numbers are roughly the same, how are you keeping actual wages at or below 30%? I know sales fixes most issues but with the pressures of fly by night lawn companies how do you compete when there are guys out there willing to service properties for less than $20 per service? Even commercial bids we have done, and lost, are going to companies that are willing to do billable work in $10-15 range. I can't understand how these companies are making any kind of money when I work on a billable rate of $35 per hr and still struggle to turn any meaningful profit. I know this is a low margin service business but how do some of these companies grow so large and still stay in business?

I know that Villa & Son's is a good example of how NOT to do it and it seems that there are 20 more operations just like them. Am I missing something?

Florida Gardener
07-04-2012, 11:32 AM
jvanvliet, I don't know how large or seasoned your operation is but I have a question about your WC and Unemployment tax. Right now I'm paying the initial rate for unemployment tax which works out to 2.7% and then you add it the WC at roughly 3.5% and then Med & SS at 8.5% you call that roughly 15% on top of actual payroll. So assuming your numbers are roughly the same, how are you keeping actual wages at or below 30%? I know sales fixes most issues but with the pressures of fly by night lawn companies how do you compete when there are guys out there willing to service properties for less than $20 per service? Even commercial bids we have done, and lost, are going to companies that are willing to do billable work in $10-15 range. I can't understand how these companies are making any kind of money when I work on a billable rate of $35 per hr and still struggle to turn any meaningful profit. I know this is a low margin service business but how do some of these companies grow so large and still stay in business?

I know that Villa & Son's is a good example of how NOT to do it and it seems that there are 20 more operations just like them. Am I missing something?
Your billing your guys out at $35/MH and are having trouble turning a profit??
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RBatten
07-04-2012, 06:25 PM
I'm not having trouble turning a profit, Im having trouble turning a MEANINGFUL profit. My margins are low. I know that I need more volume, as my fixed costs are high. Being a small operation with excess capacity, I know that I have room for growth without having to shell out large quantities of money. At this point I could add another 5-7K per month in maintenance before I would need another crew on the road. My main concern is how to compete with companies that are charging 10-15 per MH. I don't see how anyone, even a solo operator could make a living billing that. Even $20 a MH seems like a waste of time. Even working 60 hrs a week would only gross $1200 per MH, BEFORE expenses. With commercial auto, WC, unemployment and every other expense there would be less than 2-3% left.

Companies don't grow to 5mil billing $20 per MH so what am I missing?

Florida Gardener
07-04-2012, 06:41 PM
I'm not having trouble turning a profit, Im having trouble turning a MEANINGFUL profit. My margins are low. I know that I need more volume, as my fixed costs are high. Being a small operation with excess capacity, I know that I have room for growth without having to shell out large quantities of money. At this point I could add another 5-7K per month in maintenance before I would need another crew on the road. My main concern is how to compete with companies that are charging 10-15 per MH. I don't see how anyone, even a solo operator could make a living billing that. Even $20 a MH seems like a waste of time. Even working 60 hrs a week would only gross $1200 per MH, BEFORE expenses. With commercial auto, WC, unemployment and every other expense there would be less than 2-3% left.

Companies don't grow to 5mil billing $20 per MH so what am I missing?

Well, your leaving out a couple of things. A company only has to pay WC if it has more than 3 employees. So your solo to 4 man company doesn't have to pay WC. I pay $90/Mo. to cover my truck and my trailer....not sure how much your paying.

Nobody is making money at $10-$15/MH. Even if your paying a guy $8/HR under the table, your making $7 off of him at the most, which is garbage. $20/MH sucks too. The going rate here is $25/MH. I shoot for $30-$35. If it's just me, $50/HR.

A lot of the big companies here, IMO, make very, very little money on the maintenance. IMO, they make the money on mulch, installs, etc. I don't see any point to not make good money on EVERYTHING you do, just as you said. I can go make more money elsewhere, so breaking even on jobs, or barely making money on maintenance so I can "get the extras" is not something I am willing to do.

The big companies that are making that kind of money are either billing out properly, or working on very large volume. The 2 biggest guys on this board that I know of(Jim Lewis and AzGardener are not billing out at $15/MH).

Florida Gardener
07-04-2012, 06:46 PM
What fixed costs are high that you have??

RBatten
07-04-2012, 07:47 PM
What fixed costs are high that you have??

Commercial auto $650 per month (3 vehicles 2 trailers), one car payment $400 per mo., maintenance seems to run consistanly $100-$200 per month, phone $250per, internet $50, office supplies $50 per (stamps, envelopes, paper, ink)=$1600 per.

That doesn't inlcude gas, which runs $1300-1500 per and labor.

Florida Gardener
07-04-2012, 07:55 PM
Commercial auto $650 per month (3 vehicles 2 trailers), one car payment $400 per mo., maintenance seems to run consistanly $100-$200 per month, phone $250per, internet $50, office supplies $50 per (stamps, envelopes, paper, ink)=$1600 per.

That doesn't inlcude gas, which runs $1300-1500 per and labor.

Hmmm...have you shopped around for auto? Have you considered converting to Quickbooks and eliminating the need for stamps, envelopes, etc?? Why is you phone bill so high?? You said you have room for 5-7K more in income. Could you eliminate some accounts or routes and downsize??
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Landscape Poet
07-04-2012, 08:36 PM
Labor is my single biggest expense, followed by fuel, fleet maintenance and repairs. I don't know how you can possibly cut labor to as low as 14%. My labor cost lock stock and barrel (taxes, insurance, etc) is about 47% during season and about 30% off season (off season we furlough 30% of our crew).


I am able to reach 14% with ease and could make it lower if I did not pay my guy for a full 40 during the on weeks during winter. If I was a real prick I could send him packing during the winter months all together and call it good and either re-hire him or another as spring approaches and bring my profits up.

My lower % comes from as stated not including my labor in that too in case you missed that part, the rest is just volume as we are a two man crew handling roughly 28-30 residential lawns each day. Most of our properties are newer (within 7 years or so old) so the landscape is not mature which requires less input on our part too. I do not chase shrubs etc just for the hell of it either. Most guys that I know will include shrub trimming etc for a extra $20 or $30. That simply does not make sense to me when I can go two houses down and mow their lawn and not spend near the time and make twice as much gross. It simply does not make sense to me and my business model. The same holds true for high detail properties....do we still have some..yes but I can assure you that those are not as profitable in this market as they should be in comparison to just straight mow, trim, edge, blow properties. There is a line of diminishing returns in the current market. Everyone is willing to give the customer extra for just a little more. I don't see it that way. You want your shrubs trimmed and you have a house surrounded by viburnum - that is fine, but it will cost you, because the time I spend jacking around with your viburnum every month - I can go mow two of your neighbors 3K of turf properties, edge them, trim them, and blow them off. This is were I differ from many - I do not let my ego get in the way and only insist on doing the nicest properties with customer who want everything perfect....I like the upper middle to middle class person who works 60 hours a week, does not have a detailed landscape that consumes time each month and just simply wants someone reliable to care for the lawn, not scalp the piss out of it, not be consistent with the days they are mowed, will leave them a note in the mailbox or drop them a email if the lawn is too dry or if webworms or any of our other lovely pest we have down here are currently attacking their lawn. I want that guy because he is happy to pay a reasonable amount just to have that done and not have to worry about it after working all week. He/She holds a well paying enough position at their employment that they are not cheap asses and will pay through the winter because they appreciate the fact that business is business. Those are my kind of people that allow me to run a 14% payroll with ease. Everyone else can have the Mc Mansions with the prices they are getting on them in the current market.

As Diamond pointed out - I am not required to pay WC because of my size so that does not figure in to my payroll either.

I think that the problem that the OP is facing is just what many lawn guys face, they want to be big, they want to have it all. That is ego getting the best of you if you are not in the position to correctly grow like that. The simple step of adding another truck and trailer is one that I am struggling with right now. That is extra money in fuel, extra money for the truck, extra money for insurance, extra money for maintenance upkeep of equipment etc etc after the initial outlay of cash to equip the trailer you have to purchase so that it ready for business.

Like the OP stated, he has the ability to take on a extra 5-7K in accounts right now...my question would be why is he already there? You know Jvan and so should any one else that has been in business for awhile...Payroll is your largest expense....why would you keep that many people employed if you did not have the need for them. Why would you have that much equipment at the ready?

My plan instead of being ready for today for what might happen tomorrow. Swamp myself with so much work that it is hard for us to keep up, which is where we are at. Before I buy another mower, truck, trailer, set of sticks, insurance for it all...myself and my guy will work OT. Why pay OT? Because it is sure as hell a better return on my investment that having equipment sitting around not bring me home money.

Many of you have asked why do you sub your sod etc out. Because my ego does not get in the damn way of my pocket book, that is why. I make a very very nice profit on sod each year for essentially taking sales calls, spending some time with the customers, asking silly questions like why are we replacing sod? The generally don't know - or their pest control company let it happen or their lawn guy did not let them know anything was wrong or that he took out 3 sprinkler heads on a visit but did not bother to tell them. I take that little time, figure out why the sod went bad - sell it, have a good close rate on selling my maint. service while discussing this, and oh yeah, then I sell them the PCO part too. Then I collect my check for the sod from them, collect my check for lawn maintenance , check my collect for the PCO part and guess what...all I did was the lawn maintenance. I do not let my ego get the way of my wallet. Too many lawn turds want to do everything themselves, they want to be the biggest and baddest and fail because they are overstaffed,, try to grow to fast, want to have the nicest trucks and nicest accounts, that is why I am able to keep my payroll low - I simply do not do that. I grow slow and steady taking on work that is profitable and which allows me volume. In this business just like every other there is a law of diminishing returns ..the trick IMHO is to figure where you can make money and laugh your ass off a the guys that think you are as good of a businessman as them because you do not have the brand new f-350 or the most tricked out trailer. Look deep at your cost on a property by property bases and you will start finding out where your real money comes from and where it does not come from.

jvanvliet
07-05-2012, 05:53 AM
jvanvliet, I don't know how large or seasoned your operation is but I have a question about your WC and Unemployment tax. Right now I'm paying the initial rate for unemployment tax which works out to 2.7% and then you add it the WC at roughly 3.5% and then Med & SS at 8.5% you call that roughly 15% on top of actual payroll. So assuming your numbers are roughly the same, how are you keeping actual wages at or below 30%? I know sales fixes most issues but with the pressures of fly by night lawn companies how do you compete when there are guys out there willing to service properties for less than $20 per service? Even commercial bids we have done, and lost, are going to companies that are willing to do billable work in $10-15 range. I can't understand how these companies are making any kind of money when I work on a billable rate of $35 per hr and still struggle to turn any meaningful profit. I know this is a low margin service business but how do some of these companies grow so large and still stay in business?

I know that Villa & Son's is a good example of how NOT to do it and it seems that there are 20 more operations just like them. Am I missing something?

1/3 of the labor force is furloughed from November through the end of March and we go to a four day work week.

Work crews for special projects are billed @ $25.00 per hour.

Duekster
07-05-2012, 07:18 AM
Man I wish we could be excluded from WC. I suppose I could be but many of my commercial contracts require it. I would be taking a financial risk without WC even if not required.

Ric
07-05-2012, 09:45 AM
Man I wish we could be excluded from WC. I suppose I could be but many of my commercial contracts require it. I would be taking a financial risk without WC even if not required.

I got caught with a small WC violations that opened Pandora's Box. I had a casual Helper on a job with my regular employees. Workers Comp walked up on the job checking. OK I am Guilty of one day labor off the books. They audited my books back 3 years and fined me for every subcontractor I had that I didn't have a WC paper on. It didn't matter if that Sub had WC, Only that I didn't have proof. BTW the WC Inspector was a Divorced Woman who was training two new inspector both who were divorced women. All Man Haters.

.

RBatten
07-05-2012, 12:50 PM
Hmmm...have you shopped around for auto? Have you considered converting to Quickbooks and eliminating the need for stamps, envelopes, etc?? Why is you phone bill so high?? You said you have room for 5-7K more in income. Could you eliminate some accounts or routes and downsize??
Posted via Mobile Device

I have shopped the auto, and believe it or not, that is a good rate. Its billed 10 months a year, two months no bill. It works out to $160 per mo per vehicle. One is a HD box truck that is almost half the premium, but well worth the extra cost, providing advertising (rolling billboard) and security for the equipment. The phone includes office line, fax and cell phones. I tried not providing cell phones for the crew leaders, but they never seem to pay their bills on time and their phone would get cut off. I got tired of not knowing what was going on some of the time. Its also a nice perk that doesn't cost an arm and leg, like health insurance, which I don't provide.

I could downsize and get back on the truck, but then growth would slow to a crawl and there would be no time to bid new work and take care of customer relations. I want a business not a job. If I'm working in the business, I'm not working on the business, and a business that isn't growing, its dying. I also don't want a job. If something happens to me, I get hurt or sick, then there is no income and this business is too tough to just be a job. There are a whole lot easier ways to make a living if you just want a paycheck. **** I would propbably make a whole to more money working for someone else, but I would loose alot of the freedom that my position offers.

I don't need to be the biggest, baddest guy on the block, but I do want something that has value that someday my kids can have or sell. I guess I want a legacy, to have something of value for my family. My wife has a job, and it pays very well, but at the end of the day all she really has is a paycheck. Something happens to her and the income is gone.

Right now I'm in that middle ground between having too little work for current staffing and having too much work if I cut it. I'm still running good labor and profits, but I want to make sure that I'm getting every penny I can while I work on growing.

mjlcare2
07-05-2012, 01:41 PM
All of you guys who don't have workers comp even if you ARE under the 3 employees.. what are your plans if you or your "workers" do get hurt on the job? sue your clients? just wondering..

not having the right insurance's is a risk I'm not willing to take even if I was under the 3 employees. and many of the commercial contracts require it!

Landscape Poet
07-05-2012, 09:02 PM
All of you guys who don't have workers comp even if you ARE under the 3 employees.. what are your plans if you or your "workers" do get hurt on the job? sue your clients? just wondering..

not having the right insurance's is a risk I'm not willing to take even if I was under the 3 employees. and many of the commercial contracts require it!

Just because you do not have workers comp does not mean that you can not be covered by a umbrella policy, it is my opinion that you should have one no matter if you are sole prop or LLC, the umbrella gives you the needed security " Just in case"

Landscape Poet
07-05-2012, 09:37 PM
I have shopped the auto, and believe it or not, that is a good rate. Its billed 10 months a year, two months no bill. It works out to $160 per mo per vehicle. One is a HD box truck that is almost half the premium, but well worth the extra cost, providing advertising (rolling billboard) and security for the equipment. The phone includes office line, fax and cell phones. I tried not providing cell phones for the crew leaders, but they never seem to pay their bills on time and their phone would get cut off. I got tired of not knowing what was going on some of the time. Its also a nice perk that doesn't cost an arm and leg, like health insurance, which I don't provide. Your phone situation is simple. You discuss with them the fact that you pay them to be a crew leader and that comes with certain responsibilities. If they can not be responsible enough to pay their own phone bill, how effective can they be as crew leaders? Are you scared of letting them go? In case you have not noticed unemployment is pretty darn high in in Florida and there are lots of people looking for work. Maybe I am just lucky but when I advertised for a employee I had people with all kinds of green industry knowledge for assistant golf course supers to guys that had worked at Disney and Universal for YEARS. I had people sending me their resume that had their Masters degree, but the economy sucked so bad they just wanted a job. I am not a big fan of using intimidation on a employee, but I would if they did not have their act together enough to pay their phone bill. There are people out there who are leaders looking for jobs and have the common sense enough to manage to pay their phone bill so when the boss calls and says lets go work, they can answer the damn phone.



I could downsize and get back on the truck, but then growth would slow to a crawl and there would be no time to bid new work and take care of customer relations. I want a business not a job. If I'm working in the business, I'm not working on the business, and a business that isn't growing, its dying. I also don't want a job. If something happens to me, I get hurt or sick, then there is no income and this business is too tough to just be a job. There are a whole lot easier ways to make a living if you just want a paycheck. **** I would propbably make a whole to more money working for someone else, but I would loose alot of the freedom that my position offers. You can not have it both ways. You can not complain about the % of payroll but not be driving the sales home yourself. If as you state you need to be free to drive customer relations and drive sales. What seems to be the failure in why you can handle a extra 7K of work right know???? I do not give a crap what kind of lawn boy logic you try to apply to it, call it a job, call it a business, call it whatever the heck you want, but I can assure you any SMALL business owner or Large Business owner has a JOB. DO you think that Donald Trump wakes up some days and simply does not work to earn his money? Think again. People who have money have accomplished things in their life/work are working all the damn time. Do you think that this people do anything and I mean anything without worrying about how they are going to get their next dollar? The difference between being successful and not is a matter if you are hungry or not. That is it, do you wake up in the morning and feel that strange nervous feeling in your stomach that feel like a bunch of angry bees floating around in your stomach???? That is you worrying about how you are going to make your next dollar, how much profit are you going to pull in this month, will you be able to buy whatever it is your kid wants this month, whatever you wife wants to do this month....you have to feel them damn angry bees in your stomach. If you do you will be like whatever example you want to use that is truly successful ....you will will wake up in the damn morning and work your tale off until you simply must go to bed, the entire time wonder how are you going to grow, how many sales can you gain tomorrow. The morning you wake up and don't feel those angry bees in your stomach is the day you and your business start to decline. So you state you are overstaffed, you don't work in the feild and do not want to because that would simply be having a job. Then who the hell is selling the business? If you don't go do that job, then I think you should understand who is to blame for having a crew overstaffed enough to handle a extra 5K worth of work.




I don't need to be the biggest, baddest guy on the block, but I do want something that has value that someday my kids can have or sell. I guess I want a legacy, to have something of value for my family. My wife has a job, and it pays very well, but at the end of the day all she really has is a paycheck. Something happens to her and the income is gone. Again - this is lawn boy logic that has been spread on this site so much it makes me want to puke everytime I see it. I want a business not a job....WAAA WAAA WAAA:cry::cry::cry: Go to anyone you consider successful in your community and ask them if they have a job. I bet you the answer after looking at you like you are mentally slow is your darn right I do and that they put in a heck of a lot of work to achieve what they have. Nothing is going to be give to you. Just because you went to city hall and bought a license and opened up a lemon aid stand does not mean you are entitled to crap. You may one day out sell Minute Maid in lemonade...but I can assure you that if you do you will agree that you still have a job.

mjlcare2
07-05-2012, 09:50 PM
Just because you do not have workers comp does not mean that you can not be covered by a umbrella policy, it is my opinion that you should have one no matter if you are sole prop or LLC, the umbrella gives you the needed security " Just in case"

Dang.. I need to find me a new insurance company then.. nobody is covering my workers comp under an umbrella policy.. shoot, I've got to be insured to take a piss these days.. everybody wants to put their hand in my cookie jar!

Florida Gardener
07-05-2012, 10:32 PM
Your phone situation is simple. You discuss with them the fact that you pay them to be a crew leader and that comes with certain responsibilities. If they can not be responsible enough to pay their own phone bill, how effective can they be as crew leaders? Are you scared of letting them go? In case you have not noticed unemployment is pretty darn high in in Florida and there are lots of people looking for work. Maybe I am just lucky but when I advertised for a employee I had people with all kinds of green industry knowledge for assistant golf course supers to guys that had worked at Disney and Universal for YEARS. I had people sending me their resume that had their Masters degree, but the economy sucked so bad they just wanted a job. I am not a big fan of using intimidation on a employee, but I would if they did not have their act together enough to pay their phone bill. There are people out there who are leaders looking for jobs and have the common sense enough to manage to pay their phone bill so when the boss calls and says lets go work, they can answer the damn phone.

You can not have it both ways. You can not complain about the % of payroll but not be driving the sales home yourself. If as you state you need to be free to drive customer relations and drive sales. What seems to be the failure in why you can handle a extra 7K of work right know???? I do not give a crap what kind of lawn boy logic you try to apply to it, call it a job, call it a business, call it whatever the heck you want, but I can assure you any SMALL business owner or Large Business owner has a JOB. DO you think that Donald Trump wakes up some days and simply does not work to earn his money? Think again. People who have money have accomplished things in their life/work are working all the damn time. Do you think that this people do anything and I mean anything without worrying about how they are going to get their next dollar? The difference between being successful and not is a matter if you are hungry or not. That is it, do you wake up in the morning and feel that strange nervous feeling in your stomach that feel like a bunch of angry bees floating around in your stomach???? That is you worrying about how you are going to make your next dollar, how much profit are you going to pull in this month, will you be able to buy whatever it is your kid wants this month, whatever you wife wants to do this month....you have to feel them damn angry bees in your stomach. If you do you will be like whatever example you want to use that is truly successful ....you will will wake up in the damn morning and work your tale off until you simply must go to bed, the entire time wonder how are you going to grow, how many sales can you gain tomorrow. The morning you wake up and don't feel those angry bees in your stomach is the day you and your business start to decline. So you state you are overstaffed, you don't work in the feild and do not want to because that would simply be having a job. Then who the hell is selling the business? If you don't go do that job, then I think you should understand who is to blame for having a crew overstaffed enough to handle a extra 5K worth of work.



Again - this is lawn boy logic that has been spread on this site so much it makes me want to puke everytime I see it. I want a business not a job....WAAA WAAA WAAA:cry::cry::cry: Go to anyone you consider successful in your community and ask them if they have a job. I bet you the answer after looking at you like you are mentally slow is your darn right I do and that they put in a heck of a lot of work to achieve what they have. Nothing is going to be give to you. Just because you went to city hall and bought a license and opened up a lemon aid stand does not mean you are entitled to crap. You may one day out sell Minute Maid in lemonade...but I can assure you that if you do you will agree that you still have a job.

This is exactly what I was thinking. If you can't pay a simple bill, how should you be trusted to lead people? Not the kind of person I would want in charge of thousands of dollars worth of equipment and people's well being....

I do agree with the business vs. the job. The goal is to have people making money for you. That doesn't mean you can't go out with the crews, but I don't want to be the guy running all the equipment either....

Here's the thing though, if you have too many employees and not enough work, get you azz back out there....

Landscape Poet
07-05-2012, 10:41 PM
Dang.. I need to find me a new insurance company then.. nobody is covering my workers comp under an umbrella policy.. shoot, I've got to be insured to take a piss these days.. everybody wants to put their hand in my cookie jar!

Call and ask about a umbrella...I have a feeling that you will figure out that you are covered to the extent that you can/will feel safe should something out of the ordinary happen. A umbrella is just that - it is designed to make sure YOU are covered -hence the name umbrella.

Lets look at the facts...how many employees do you have? Are you required to have workers comp? What structure is your business? How much liability is your company really at risk for? If you should happen to be sued what assets do you/the company have that they can legally come after in the state of FL? If needed in the dramatic circumstances that something tragic did happen, would it be best for you to file bankruptcy and then open the exact same company under a different Name? IF structured correctly what is your liability.

RBatten
07-06-2012, 10:08 AM
Poet,

I don't believe I have or am complaing about my labor %. I started this post to get some feed back on my %. The feedback I have received is that it is in line with industry Best Practices.

Unless I'm missing something 35-45% is good. I won't be able to run 14% labor unless I am the crew with a helper. Thats not what I'm looking for.

I do agree with the phone thing and I will have a chat with the guys this month.

Just for the record, my excess labor is hourly so when the work is done, its done. They don't cost me any additional money. So letting them go would not be a good idea. They are trained and work well together. Right now they don't need to work 50hrs a week, they work 35, and thats what they get paid for.

mjlcare2
07-06-2012, 07:27 PM
Call and ask about a umbrella...I have a feeling that you will figure out that you are covered to the extent that you can/will feel safe should something out of the ordinary happen. A umbrella is just that - it is designed to make sure YOU are covered -hence the name umbrella.

Lets look at the facts...how many employees do you have? Are you required to have workers comp? What structure is your business? How much liability is your company really at risk for? If you should happen to be sued what assets do you/the company have that they can legally come after in the state of FL? If needed in the dramatic circumstances that something tragic did happen, would it be best for you to file bankruptcy and then open the exact same company under a different Name? IF structured correctly what is your liability.

I've got 8 employees, I am required by law to have workers comp, and most of my commercial accounts require it. The other owner and myself are exempt from the W/C. I have to carry a 3mil/2mil general liability policy again because of the commercial places, some are some pretty big and expensive buildings. Legally they could come after everything with the business name on it, shop, equipment, bank accts. whatever they want. The other owner and myself are personally not liable but the business is. I've checked and double checked on the insurance, its what I gotta have.. If we were just doing residential yards, I wouldn't need any insurance.. its not like they ask or even care.. and If I'm doing say a sod or landscaping/ irrigation job and something goes wrong and the whole yard/landscape dies or the irrigation springs a leak or whatever, my insurance would kick in and pay the damages

GreenT
07-06-2012, 08:56 PM
I do not chase shrubs etc just for the hell of it either. Most guys that I know will include shrub trimming etc for a extra $20 or $30. That simply does not make sense to me when I can go two houses down and mow their lawn and not spend near the time and make twice as much gross. It simply does not make sense to me and my business model. The same holds true for high detail properties....do we still have some..yes but I can assure you that those are not as profitable in this market as they should be in comparison to just straight mow, trim, edge, blow properties. There is a line of diminishing returns in the current market. Everyone is willing to give the customer extra for just a little more. I don't see it that way. You want your shrubs trimmed and you have a house surrounded by viburnum - that is fine, but it will cost you, because the time I spend jacking around with your viburnum every month - I can go mow two of your neighbors 3K of turf properties, edge them, trim them, and blow them off. This is were I differ from many - I do not let my ego get in the way and only insist on doing the nicest properties with customer who want everything perfect.....


Mike, I'm confident you will do well in the future with your operation. You are an intelligent man. That said, don't fall into the trap of thinking you have everything figured out. Do that and you will limit yourself.

There's a world of very high end clients that will not flinch at a $20K per year maintenance budget on their residence. Some, a lot more.

And that's a world that is extremely profitable....

.

Florida Gardener
07-06-2012, 08:59 PM
Mike, I'm confident you will do well in the future with your operation. You are an intelligent man. That said, don't fall into the trap of thinking you have everything figured out. Do that and you will limit yourself.

There's a world of very high end clients that will not flinch at a $20K per year maintenance budget on their residence. Some, a lot more.

And that's a world that is extremely profitable....

.

Glad someone on here gets it.....

Florida Gardener
07-06-2012, 09:01 PM
Mike, I'm confident you will do well in the future with your operation. You are an intelligent man. That said, don't fall into the trap of thinking you have everything figured out. Do that and you will limit yourself.

There's a world of very high end clients that will not flinch at a $20K per year maintenance budget on their residence. Some, a lot more.

And that's a world that is extremely profitable....
.

That's what I meant to do the first time.....

Landscape Poet
07-07-2012, 07:45 AM
I've got 8 employees, I am required by law to have workers comp, and most of my commercial accounts require it. The other owner and myself are exempt from the W/C. I have to carry a 3mil/2mil general liability policy again because of the commercial places, some are some pretty big and expensive buildings. Legally they could come after everything with the business name on it, shop, equipment, bank accts. whatever they want. The other owner and myself are personally not liable but the business is. I've checked and double checked on the insurance, its what I gotta have.. If we were just doing residential yards, I wouldn't need any insurance.. its not like they ask or even care.. and If I'm doing say a sod or landscaping/ irrigation job and something goes wrong and the whole yard/landscape dies or the irrigation springs a leak or whatever, my insurance would kick in and pay the damages

I understand why you are required that amount of insurance and do not be surprised if residential start asking for insurance. I have never had them ask for license or insurance until this year, i actually had two request with the last two months. One stated that she had called many people and many responded but they could never prove they had a license or insurance. As you know proving this is not a hard or time consuming process as you simply call or email your agent asking for proof to be sent and they will take care of it including a hard copy if you want. I always thought that with the cost of basic gen liability most operations had that down here but from the one residential customers input it simply does not sound accurate
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Landscape Poet
07-07-2012, 07:55 AM
Mike, I'm confident you will do well in the future with your operation. You are an intelligent man. That said, don't fall into the trap of thinking you have everything figured out. Do that and you will limit yourself.

There's a world of very high end clients that will not flinch at a $20K per year maintenance budget on their residence. Some, a lot more.

And that's a world that is extremely profitable....

.

I do not doubt that market exist T nor that it is profitable or that it can be, but i am sure you would admit that it is a much smaller market with more limitations on obtaining those accounts.
My complaint was not so much about one style of account of business model as it was against that we are guilty of some lawnboy logic from time to time but in todays market if you are not careful you find yourself in our hot weather do hard work for much less you could make doing a simple mow n blow job. I figure you are smart enough to read between the lines and know what i am referring to.
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GreenT
07-07-2012, 04:18 PM
My complaint was not so much about one style of account of business model as it was against that we are guilty of some lawnboy logic from time to time but in todays market if you are not careful you find yourself in our hot weather do hard work for much less you could make doing a simple mow n blow job. I figure you are smart enough to read between the lines and know what i am referring to.


I understand your point as it relates to your own experience. All I'm saying is that it is not the only one.

Properly structured and to different degrees, every market niche can be profitable. The question is, which one -based on your ability and preference- are you willing to pursue.

.